Town hall: city fiber network would cost $35 million-$40 million, need 40% of homes to subscribe
September 20, 2022, 6:00 p.m. · American Fork City Hall, 31 N. Church St.
At a town hall on citywide fiber, City Administrator David Bunker said the city-owned open-access network built and run with STRATA Networks, the only respondent to the city's solicitation, would cost $35 million to $40 million and be paid off through a 30-year bond from subscription revenue, which requires about 40% of homes to sign up. He acknowledged that if take rates fall short, other revenue such as sales tax would have to cover the bond. Sample retail prices ranged from $65 a month for 250 Mbps to $200 for 10 Gbps.
From the approved minutes.
Decisions at a glance
| Item | Result |
|---|---|
| Citywide fiber town hall | Discussed |
Agenda, item by item
Item 1 · Roads and utilities
Citywide fiber town hall
Discussed
IT Director George Schade traced the city's broadband history (AirSwitch purchase in 2002, sold 2008, retained backbone fiber from Salt Lake to Spanish Fork). Camden Bird cited 2019-2021 surveys (870, 1,500 and a statistically valid 615 responses) showing fiber as a priority. STRATA's Tyler Rasmussen and David Ryan described a subscription model: about $12-13 per subscriber to the ISP, about $20 to STRATA for operations, and the rest to the city for bond payments and equipment refresh. Bunker put the cost at $35 million-$40 million, financed by a 30-year bond needing a 40% take rate; timeline: final design and agreement fall 2022, pre-registration winter 2022.
- Bond$40.0 million to STRATA Networks
- Partner: STRATA Networks (sole proposer)
- Estimated cost: $35M-$40M
- Bond: 30 years, repaid from subscriptions
- Break-even take rate: about 40%
- Sample prices: 250 Mbps $65/mo; 1 Gbps $75; 2 Gbps $100; 10 Gbps $200
- Per-subscriber split: ~$12-13 ISP, ~$20 STRATA, remainder city bond/refresh
What residents said
Taxpayer risk if fiber take rate falls shortCost of fiber bondRoad damage from fiber installationInternet access gaps
Residents asked about hookup fees, equipment, ISP choice, whether the bond would raise taxes, the bond's 30-year term, whether non-subscribers would bear risk (Bunker said yes, if the 40% take rate isn't met), why UTOPIA wasn't chosen (it didn't bid), road damage from micro-trenching, and cost overruns. One resident said he paid Comcast $15,000 for a directional drill to get service and supported the project.